The plan - proposed by Gene Sperling, a top advisor to treasury secretary Timothy Geithner - would make some of the $700-billion TARP program funds available to small businesses through the Small Business Administration's 7(a) loan program, multiple news sources reported.

This would allow small businesses access to loans underwritten by the government, at lower rates and with fewer restrictions, to finance growth or short-term debt management.

The news follows increasing concerns that the bailout is not doing enough to help small businesses, which employ 60 to 80 percent of the nation's workers, according to data from the SBA.

"We still have good businesses whose credit lines have been cut and need liquidity," SBA administrator Karen Mills told the Wall Street Journal. "I think there will be continuous discussions until we're out of this whole liquidity and bank crisis, because small businesses are going to be the engine that takes us out of this recession."

With less than $100 billion of the $757-billion stimulus package spent, according to Forbes, and the unemployment rate rising to 9.5 percent last month, this initiative is the latest option in a push to increase the effectiveness of the bailout program.